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Tuesday, June 11, 2013

No Freaking Idea

Yesterday we seemed to be encountering some resistance, and that was confirmed today. We did get what seemed to be a dip buying opportunity this morning, but in the afternoon gave it all back. Volume increased today, which could mean at least some trouble going forward. However we did hold an important intraday support level, and are still above the 50dma, so all is still, if not well, at least not on life support yet.
 I would expect crude oil to collapse before the market (although tha does not have to nappen, I think it likely), and it has yet to collapse, but it is clearly struggling to get above 97. The 50dema is now splitting the current trading range, giving it more support than normal, so we mightt get a bounce off it. If this can start moving higher, I expect the market will as well.

It seems like everyone has just about forgotten gold. I wouldn't go near this now unless it can get back above the 50dema. I think by then, this will be totally forgotten, and ready to make q pretty good run to the upside. That is still probably weeks, if not months, away.
A near breakout in the 10 year yield reversed and ended up below the breakout point. This is pretty overbought and may pull in a bit, but ultimately it is headed higher. The target I have is awfully high, but withing reason considering it is still historically very low. I am already hearing how bullish this is for stocks, as the money coming out of bonds is going to go into stocks (the "money on the sidelines" fallacy that I have written about before). I don;t buy that for a second: bond traders are not that dumb.

I used to sort of understand the relation between the Dollar index and equities, oil, and gold, but now I have no idea what is going on. Really. Just no freaking idea.

We are pulling back again right about at the 50% retracement of the previous pullback, which, so far, has not been that ominous, but if we can;t get to a new high, look for the start of the correction (the "big one") that I have been anticipating all year. I don;t think it is coming quite yet, but I could be wrong, so don't get complacent.

I will have the new highs update shortly.

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